Bank of Japan stands pat, issues tiny statement

LOS ANGELES (MarketWatch) — The Bank of Japan held off on any new policy moves Friday, as most economists had expected in the wake of major new easing initiatives at its previous meeting.

Reuters

The Bank of Japan building in Tokyo

In an unusually terse, two-sentence statement, the Japanese central bank only said that it “will conduct money-market operations so that the monetary base will increase at an annual pace of about 60 [trillion]-70 trillion yen,” or roughly $610 billion to $710 billion, unchanged from its previous target.

Dow Jones Newswires said that all 10 analysts it surveyed ahead of the decision had expected no action.

At its last meeting on April 4, the Bank of Japan launched an aggressive easing program under newly appointed Gov. Haruhiko Kuroda, including a major expansion of government-debt purchases and a shift toward buying longer-dated bonds.

However, the lack of fresh moves did spark a small market reaction, with the yen rising modestly after the announcement. The dollar
USDJPY, +0.94%
slipped to ¥98.78 from ¥99.06 just ahead of the statement.

Likewise, stocks briefly lost ground, with the Nikkei Stock Average
NIK, +1.23%
sliding into losses before rebounding within minutes in what had already been a volatile Friday trading session. Read Asia Markets.

The central bank was due to issue its semi-annual economic forecast report later in the day, followed by a news-media briefing by Gov. Kuroda.

The Nikkei business daily reported earlier Friday that the new forecast would project consumer prices to reach the Bank of Japan’s 2% target in the fiscal year ending March 2016.

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